May 2008 - Cover Story
Menu Selling
The one tool that's revolutionized the F&I office in the automotive industry is the menu. Now it's time for powersports dealers to reap the benefits. F&I expert shows you how to make the transition.
By Ron Martin
If you’re closing with lines such as, “What do you think?” or
“Would you like to go ahead with it?” the response you can expect is, “I’d like
to think about it” or “I’m not interested.” The best way to get the “yes”
answer you’re looking for is to ask customers an alternative closing question
like, “Would you like to pay cash or finance?” An even better one is, “Do you
prefer option one, two, three, or four?” The alternative close is probably the
biggest advantage of what many refer to as menu selling, or as I prefer to call
it, menu closing.
Many F&I managers in the powersports field are considering a move
from step selling to the consumer-friendly, profit-driven menu-selling
approach. Some, like Ryan Beckers, have already made the switch.
“I increased my dollars per unit by $100 since I started using a menu,”
said Beckers, who works at the Minnesota-based Hitching Post Hopkins. “I have
found it quite a bit easier to make sure that my clients have all of their
choices to protect themselves presented in a clear and non-threatening
environment. I think a menu makes it easier for customers to choose the product
that is right for them.”
Ryan Rebollar, who works for Imperial Valley Cycle Center in California,
was sold on menu selling when he saw his product penetration rates increase.
“Selling with an electronic menu increased my per retail average at least $75
per unit sold,” he said. “It gives me the opportunity to offer all back-end
products all of the time. In doing this, my product penetration went up
dramatically.”
The Evolution of Menu Selling
If we take a glance back to the roots of F&I, we’d probably start
with the selling system developed by Pat Ryan. Considered one of the
trailblazers of the automotive industry’s F&I segment when he founded Pat
Ryan & Associates (now known as AON Corporation) in 1964, he designed a
system around what was referred to as step selling.
The system required that F&I managers present and close on a single
product before moving onto the next. Back then there were only three products
to present: service contracts, credit life and disability insurance. With only
three products, step selling could be done fairly effectively, but it’s not the
most effective way to sell. Today, step selling serves its purpose after the
customer has made his or her initial choice; that is, to get them to take one
or two additional products after they have selected an option from the menu.